Oct 10 (Reuters) - Activist investor Clinton Group said it will no longer push for the sale of women's clothing retailer Wet Seal Inc after winning control of the board last week, but will instead focus on turning the company around.

The hedge fund, however, said that Wet Seal could attract buyers if it managed to improve its business, and an offer of between $5.00 and $8.00 per share would represent fair value.

The stock was trading at $2.98 on the Nasdaq on Wednesday, valuing the company at $270 million.

Wet Seal named Clinton Group nominee Lynn Davey as chairman on Wednesday. Davey was one of four Clinton nominees named as directors last week, ending a battle for control of the eight-member board.

One board seat remains vacant and the company still lacks a chief executive. Davey, the former CEO of Avalon Group Ltd, replaces Harold Kahn.

Wet Seal's share price has fallen 30 percent over the past 12 months on concerns the company's poor performance and the frequent management shakeups meant to remedy the situation.

The retailer, which caters primarily to young women, has been struggling to woo fashion-conscious teenagers at both its Arden B and Wet Seal chains.

"The only way they are going to fix the company is to get a new CEO who is going to put together a team of merchants who can get sales going," said Howard Davidowitz, chairman of Davidowitz & Associates Inc, a New York City-based retail consulting and investment banking firm.

Wet Seal fired CEO Susan McGalla in July as Clinton Group, the company's third-biggest shareholder, stepped up pressure on management to perform.

Davidowitz said the company needs to find a CEO quickly before its cash runs out. Wet Seal had cash and equivalents of $148 million as of April 28, according to a regulatory filing.

Clinton Group, which holds 7 percent of Wet Seal, said the company should focus on hiring a top-notch chief executive and improve its business before considering a sale.

"There is no definitive time frame set for a turnaround," Clinton Group Managing Director Greg Taxin told Reuters, adding he expects the company to show progress in six to nine months.

SEEKING A "FAST" REVAMP

Clinton Group had previously pressed for a sale because Wet Seal had fired its CEO without a replacement available and had no clear strategic direction, he said.

Bob Phibbs, CEO of consulting company The Retail Doctor, said the California brand that was trendy in the 1970s and 1980s would need to get younger members on the board to help bring about changes that will attract potential bidders.

"Nobody wants to buy a damaged brand," he said, adding that Wet Seal should reduce its footprint and better train its store staff to boost the business.

Wet Seal, which has been trying to return to a fast-fashion model by maintaining light inventories to respond quickly to new styles and trends, said last week that merchandising chief Harriet Sustarsic would leave to assume a similar role at True Religion Apparel Inc .

Kim Bajrech and Debbie Shinn will lead Wet Seal's merchandising operations, a responsibility they previously shared on an interim basis during a relatively successful period under the company's fast-fashion model before Sustarsic's appointment.

Shares of the Foothill Ranch, California-based company, which have climbed 14 percent since it fired its CEO in July, were down 1 percent at $2.99.